In the Spotlight: Public pension woes not fault of workers

Saturday

Oct 20, 2012 at 12:01 AMOct 20, 2012 at 7:04 PM

Public pension woes not fault of workers Illinois's state employees did not cause the state's fiscal crisis. Nevertheless many, both retired and still working, find themselves demonized and betrayed as reforms move forward: Demonized because a scattered few gamed the system, betrayed in hiring agreements that have been repudiated.

Illinois's state employees did not cause the state's fiscal crisis. Nevertheless many, both retired and still working, find themselves demonized and betrayed as reforms move forward: Demonized because a scattered few gamed the system, betrayed in hiring agreements that have been repudiated.

Recent legislation requiring state retirees to pay health insurance premiums even though they were promised no premiums if they worked 20 years for the state represented a breach of agreement and a belated pay cut. The benefit was compensation earned under accepted job offers, not a free entitlement.

Similar logic may apply to reforms that may come after Election Day affecting health coverage, the cost-of-living-adjustment (COLA), or contribution levels.

Hiring agreements are contracts. New hires get lesser offers but now must worry whether the state will honor their hiring deals if it gets into a future jam.

The cause of the state's crisis is clear. Illinois made do on limited revenue. Careful management was needed but not always there.

As state employees paid their scheduled share into the pension systems, the state often failed to do likewise, using the money elsewhere. Retirement costs were covered through borrowing. Everyone, including state employees, should have complained more loudly. The resulting debt service now dwarfs current retirement costs and cripples the state.

Few Illinois residents realize that only about a sixth of state employees participate in federal Social Security.

In return they get smaller state pensions. State employees who once worked elsewhere may receive Social Security but in severely reduced amounts. Illinois pensions are about average among the states. Many Illinoisans cannot believe any of this. Others forget who is teaching their children, and nurses, and doctors; who is policing their towns; who is putting out their fires, plowing their highways and making agencies function.

Illinoisans once recognized that pension systems attract raids, so they approved the constitution's pension-protection clause. The raids came anyway.

Now a paragraph "D" hidden in a proposed amendment on the November ballot might endanger the clause.

The buried paragraph is the worst feature of the proposal, which on its face would require three-fifths majorities on state and local boards to raise pension benefits, even though pension problems do not stem from the size of benefits. Neither the proposal nor the paragraph would likely succeed if public workers received balanced regard instead of demonization.

State workers must shoulder some reforms, but violating hiring agreements is always wrong.

Deckle McLean retired in 2006 from Western Illinois University, where he served as a journalism professor and director of the journalism program. He lives in Macomb.